GUEST OPINION: Law change eliminating landline phone and competition is not the answer

By Thane Namy

Monday, December 9, 2013

There has been a lot of talk about the change of current law, also known as Senate Bill 636, which many contend will give large phone companies the ability to eliminate landlines, competition and in turn raise prices in Michigan. Despite the major effort to spin and refute this by the large carriers, it is simply undeniable.

This change of law will allow a large carrier to provide notice they are discontinuing landline service in your area, with exceptions only for 911 service issues. There would be no state or federal regulatory authority to prevent this. In many cases, replacement services will be more expensive and less reliable.

This change of law would result in higher prices and less choice for Michigan consumers and businesses. The current law has been very successful in creating robust competition, providing consumers and businesses many choices for service. It shouldn’t be designated to a few select companies through legislation.

Michigan competitive providers employ thousands of people in high-paying technical positions. This change of law effectively eliminates statewide phone competition. Recently, a competitive provider disbanded their entire statewide sales force after Senate Bill 636 was voted on in the Senate. If this change is adopted, other competitive providers will follow suit costing Michigan jobs and hurting our economy.

Once the change of law takes effect, access to simple but important parts of the public telephone network are eliminated for competitive providers. Competitive providers invest millions of dollars in Michigan each year to deliver innovative products. Michigan should not operate where millions of dollars are wiped away with a stroke of a pen under the guise of “nationalization,” “modernization” or any other false justification.

We have heard before how changing a law will benefit us without clear explanations how or what the benefit will be. We often later find there was no benefit or it only benefited a select few at the expense of others. We know this legislation will take away choices or force choices upon us. This bill will be in full implementation before consumers and businesses begin to feel all of the effects. Despite these warnings, this bill is on a fast track moving through our legislature.

One unintended consequence could be low service areas. For example, what if your home is located in a discontinued service area? How much does that lower the value of your home? Will some areas become low technology zones? I don’t know how this will play out and, frankly, no one does.

So is it wise to expose a vital part of the Michigan economy to the risks of unintended consequences?

As CEO of a Michigan Competitive Provider, I am happy to compete because I believe the Michigan men and women in our company will bring the best products and services to market. We need to let the market determine success or failure not legislation.